Boston is getting a new low-cost airline from Iceland. Can this one actually survive? - The Boston Globe


How can Play possibly avoid the same fate as WOW?

“The model of WOW did really well until the company kind of broke it and they began to fly to the West Coast,” said Birgir Jónsson, the CEO of Play. “WOW introduced wide body jets and bigger aircraft. They flew to India, they introduced Israel, and basically broke the business model that actually had proven to work.”

The business model that had originally worked for WOW, and that Jónsson is hoping will do the same for Play, is short-haul flights from the East Coast of North America to Play’s hub at Keflavík Airport. This time, there will be no expansion to the West Coast or other locations that require a long flight to Iceland. At one point, WOW introduced a first-class cabin. Jónsson said none of that will be happening with Play.

“We can take the lessons learned and build on them,” he said. “And try to avoid making the same mistakes as they did.”

Play launched in 2019, an unfortunate time to introduce an airline given the plummeting demand that came with the pandemic the following year, but Jónsson said business through the summer of 2021 was robust. Passenger counts began declining last month as COVID-19 cases increased throughout Europe. But the airline is forging ahead, banking that the virus will be better contained by next spring. Its summer 2022 schedule currently includes flights to 22 destinations in Europe. Flights from Boston and Baltimore will begin in the spring. Jónsson said other East Coast cities will gradually be added.

While its chances of survival may sound suspect, Play has a few advantages. When WOW went bankrupt, it handed an Iceland monopoly back to Icelandair. (JetBlue has a codeshare program with Icelandair.)

“Going back to that period there was a huge price war in the market and you had an absolutely over-saturated market,” Jónsson said. “There was way too much capacity at that time. I think that the players that are coming in are more realistic about what’s possible. We sincerely believe that there is a market for this.”

That market is bargain-hunters who view airplanes as transportation, and nothing more. Play’s introductory deal of $109 one way is for flights departing the U.S. when customers buy a round trip ticket. Travel dates for that price are from May to June, and August and October of 2022. That’s an eye catching deal. However, travelers pay for all extras — from beverages to baggage. About 25 percent of Play’s profits will come from these ancillary fees. You’ll also pay for carry-on items and seat selection. For low-maintenance travelers, the tradeoff is the price. After the introductory fare sale, Jónsson said prices will average about $350 round-trip from Boston to locations throughout Europe, depending on the season and demand.

“We will always be really small,” he said. “WOW had an ambition of being a big airline. We expressly do not want to do that. I will never be in an interview with you and try to show off that we have a large number of employees and planes. I’m always gonna be proud that I’m small and flexible. And then, at the end of the day, we’ll have happy customers and a profitable business.”

Christopher Muther can be reached at [email protected] Follow him on Twitter @Chris_Muther.